Please ensure Javascript is enabled for purposes of website accessibility

Here's Why Ocugen Stock Rocketed 47% Today -- and Then Gave Up Almost All Its Gains

By Joe Tenebruso - Apr 23, 2021 at 9:06PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The biotech is seeking to cash in on the recent rally in its stock price.

What happened 

Shares of Ocugen (OCGN -3.08%) soared as much as 46.9% Friday, before closing the trading day up only 3.7%.

So what

Ocugen's stock price went on a tear over the past several days after a second interim analysis of a phase 3 study of Covaxin -- a coronavirus vaccine candidate developed by its India-based partner Bharat Biotech -- showed it to have overall efficacy of 78% against COVID-19 and 100% protection against severe disease.

A person is pointing to a stock chart that rises sharply and then falls.

Ocugen's stock had a volatile day of trading Friday. Image source: Getty Images.

A post on LinkedIn by Ocugen CEO Shankar Musunuri suggesting that the biotech could submit its Emergency Use Authorization (EUA) request to the Food and Drug Administration (FDA) sooner than many people expected appeared to get investors into even more of a tizzy, and it's believed to have contributed to the stock's sharp gains earlier today. 

Now what

Ocugen's partnership with Bharat Biotech gives it a 45% share of any profits Covaxin earns in the U.S., so, understandably, investors would be excited about the possibility of a near-term EUA. 

However, Ocugen announced in a press release issued at 3 p.m. EDT that it agreed to sell 10 million shares to institutional investors for $10 per share in a direct offering. Ocugen's stock had been trading near $11.61 at the time, and its shares fell in kind. 

Still, the share sale is expected to raise roughly $100 million for Ocugen, which it can use to fund its development efforts.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Ocugen, Inc. Stock Quote
Ocugen, Inc.
$2.52 (-3.08%) $0.08

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/06/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.